Facebook's Value Blows Through $100 Billion In Last Trade Before IPO

Facebook
was just valued at ~$103 billion in a final private-market trade
before the IPO.

The stock sold on SharesPost
at a value of $44.10 per share. Using the 2.33 billion fully
diluted outstanding share count cited in
Facebook's IPO prospectus, that equates to a value of just
under $103 billion.

To put the $103 billion market cap in more perspective, it's
about 1/2 of Google's market cap.

Facebook's revenue, meanwhile, is less than 1/10th of Google's
revenue.

Facebook's revenue, in fact, is about 1/3rd of Google's free
cash flow.

So at that valuation, Facebook investors are really counting on
some massive cash flow growth in future years.

And this is after Facebook's CEO Mark Zuckerberg has clearly said
that Facebook's business is designed to support its social
mission, and not vice versa.

Of course, Facebook appears to be just at the beginning of
"monetizing" what will soon be more than 1 billion global users.

In addition to the products it has already rolled out, Facebook
could well launch other huge products in the future, such as a
search engine that competes with Google, or a distributed ad
network that competes with Google.

With respect to both of those businesses, Facebook's vast number
of users and vast network of "like" buttons all around the
Internet could prove to be major competitive weapons.

I talked to one Facebook shareholder recently who admitted that
"the stock already looks rich." But he also believes that
Facebook has grossly underinvested in its monetization over the
last few years and that even a little more focus on this could
produce huge results.

As an example, the investor described the potential for a global
web-wide ad network that would compete squarely with Google's
AdSense
business, which itself is a $10 billion business.

"Post-IPO," the investor said, referring to the ad network story,
"if you lay that bad-boy out there, that's something that
investors could really get behind."